May 2018

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While demand from China is weak, spot price of EG (ethylene glycol) declined to below US $800 per ton, the lowest in nearly two years. On the other hand, SABIC International is reported to be running at full production capacity. In fact, experts anticipate most of the petrochemical units to post decline in earnings or report losses for this year.

The present market scenario has forced buyers to adopt a 'wait and watch' attitude. This is since ethylene glycol spot prices have seen a drop of nearly 25 percent since the beginning of this year and has also led to rising inventory levels with most of the manufacturers.

Industry analysts believe that decline in orders of the clothing and weaving factories in China also came in the wake of shrinking consumer business in the US. This has even affected polyester filament yarn and fibre enterprises. As such, the industry, for which the month of September is traditionally a peak time, is now uncertain about its outcome.

EG prices are hard to depict and a sharp rebound is expected in the fourth quarter though profit outlook of the industry will continue to remain pessimistic in 2009.